Court File and Parties
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Mrs. Hulya Meydaner
Lorne Levine for the Applicant
Applicant
- and -
Mr. Behran Meydaner
Respondent
Kenneth Wise for the Respondent
ENDORSEMENT
Tzimas J.
1This family law trial was heard over a number of days in January 2020. My judgment was released on June 23, 2020. The parties were encouraged to settle costs but were unable to do so. They therefore made their respective submissions for costs. In addition, they brought to my attention an interim court order that had not been previously raised and that was relevant to the overall reconciliation of monies owing and paid. Furthermore, they also advised that they could not agree to the terms of the formal judgment. Finally, although in my judgment I ordered that monies held in trust by the real estate lawyer to be paid forthwith to Mrs. Meydaner, the real estate lawyer asked for a direction and Mr. Meydaner refused to provide it. Mrs. Meydaner is therefore asking for an order dispensing with the requested direction.
2I propose to deal with the outstanding issues in the following order: a) reconciliation of interim court orders; b) the release of the funds held in trust; and c) costs. It is my expectation that with these additional orders, the parties will be able to draft a final judgment and bring this matter to a conclusion. Finally, this endorsement is to be read in conjunction with my Final Judgment found at 2020 ONSC 3857. Where I repeat my findings, I do so only for the purposes of context. Those paragraphs in the final judgment that have been updated in this endorsement are expressly identified and are effectively superseded by this endorsement.
a) Reconciliation of Interim Orders and Final Judgment
3The reconciliation of my findings in my Judgment was outlined in paragraphs 236 - 238. Since my judgment, both parties brought to my attention the interim orders of Justices Barnes and Wein as they related specifically to the advance disbursement of funds from the net proceeds from the sale of the matrimonial home. In my review of those submissions, there persists much confusion over the treatment of those interim orders and specifically, the treatment of the $60,000 advance payment to Mrs. Meydaner, the payment of $25,000, expressly ordered to be applied against any equalization payment, the treatment of the Mrs. Meydaner’s withdrawal of the $140,000 from the joint line of credit, and finally, the allocation of the s.7 obligations. I will deal with each of these separately.
i. Advance payments of $60,000 and $25,000
4Beginning with the payment of $60,000, when considered in its full context, although the court did not expressly characterize it as a sum to be applied against a future equalization payment, the implication in the judge’s reasoning is that the advance payment would serve such a purpose. I arrive at that conclusion because the said order made separate support orders for the payment of child and spousal support as well as section 7 payments. Even if Mrs. Meydaner said she used the $60,000 to support herself and her children, that sum was ordered in addition to the other support payments.
5Moreover, the judge’s explanation for his rejection of an analogous advance to Mr. Meydaner suggested his anticipation of future financial obligations by Mr. Meydaner to Mrs. Meydaner, that would have included equalization. I draw specific attention to the following explanation: “Several areas of dispute remain outstanding with respect to the value of the Respondent’s property in Turkey; the Respondent’s primary sources of income are from Turkey, he has no local income. The net proceeds remain the only source for any security the Applicant may seek for any support or other order. For all these reasons, the Respondent’s application for a $60,000 pay-out from the proceeds is deferred until disclosure issues between the parties are completed.” I conclude that in all the circumstances it is appropriate that the sum of $60,000 be treated as an advance payment against an equalization award in Mrs. Meydaner’s favour.
6The payment of $25,000, ordered to be advanced to Mrs. Meydaner on October 31, 2017, was expressly identified as a sum to be applied against an equalization award. When added to the sum of $60,000, Mrs. Meydaner received a total of $85,000 out of the matrimonial home proceeds in anticipation of an equalization payment in her favour.
7The advance payments were not attached to Mr. Meydaner’s share of the net matrimonial proceeds; they were ordered to be paid out of the net proceeds with an appropriate accounting to follow the determination of equalization. In the result, half of the payout came from Mrs. Meydaner’s share and the other half from Mr. Meydaner. In the result, it is appropriate that Mr. Meydaner be credited with 50 per cent of that payment against the equalization payment of $621,500 that he owes to Mrs. Meydaner. Fifty per cent of $85,00 comes to $42,500.
ii. The reconciliation of the $140,000 from the line of credit
8Mr. Meydaner continues to insist that Mrs. Meydaner ought to pay him back the full $140,000 and not just the sum of $70,000. That submission ignores my analysis and findings outlined in my final judgment at paragraphs 221 and 223.
9Although I do not intend to repeat the full analysis, it suggests to me a continued misunderstanding by Mr. Meydaner. The reconciliation of the sum of $140,000 has to be considered in conjunction with the treatment of the withdrawal of the $200,000.
10In short, the line of credit was jointly owned by the parties, as it was secured against the matrimonial home. Mr. Meydaner’s unilateral withdrawal of $200,000 occurred prior to separation and was therefore a joint liability on the date of separation. That meant that in the NFP analysis, each side was weighted down with a liability of $100,000 even though Mrs. Meydaner never knew of the withdrawal. Mrs. Meydaner’s withdrawal of $140,000 post-date the date of separation. It could therefore not be included in an NFP analysis as of the date of separation. That sum must be reconciled at this stage and in light of my determination on equalization.
11Just as the parties were jointly liable for the repayment of the $200,000, the parties were also jointly liable for the repayment of the $140,000. The line of credit was paid out of the matrimonial proceeds. When it comes to reconciling this particular payment, Mrs. Meydaner was entitled to withdraw $70,000, which represented her half share from the line of credit but that then made her liable for the repayment of that half share. Mrs. Meydaner, however, was not entitled to benefit from Mr. Meydaner’s share of the other half of $140,000. Having wrongfully accessed Mr. Meydaner’s share of those funds, Mrs. Meydaner must also repay Mr. Meydaner’s liability for the $70,000, or in other words his half share. In the result, Mrs. Meydaner must reimburse Mr. Meydaner the sum of $70,000, or, for the purposes of the overall reconciliation, Mr. Meydaner should receive a credit of $70,000 against his payment obligations.
iii. Section 7 and related expenses already paid
12With respect to the s.7 obligations, I addressed the issue at paragraph 218 of my final judgment and concluded that the school-related expenses in all the circumstances were rightly paid out of Mr. Meydaner’s share of the matrimonial net proceeds. To avoid any further ambiguity, those court-ordered payments include the tuition as follows: $13,540, February 2014, $10,000, November 13, 2014, and $5,750. They also include the court orders for the payment of $1,496.56 for Selim’s airfare to Turkey and $1,052.57 for Selim’s laptop. The total sum comes to $31,839.13.
13Having regard for the fact that Mr. Meydaner made some payments for spousal and child support and costs for the interim motions out of his share of the matrimonial home net proceeds, that total sum comes to $19,088 and should be credited accordingly. That still leaves him with an additional debt for child and spousal support in the total sum of $9660.
iv. Reconcilliation of all sums
14In the result, the figures for Mr. Meydaner may be summarized as follows:
50% of the net matrimonial home proceeds = $125,116.91
Credits on account of monies already advanced out of Mr. Meydaner’s share = $19,088 (support, spousal and child and interim costs) + $31,839.13 (s.7 obligations), + $42,500 for equalization already paid, for a total of $92,588.
Amounts owing: equalization of $621,500, + outstanding support obligations, $9660 = for a total of $631,160.
Net Owing = $631,160 - $92,588 = $538,572.
15The figures for Mrs. Meydaner may be summarized as follows:
50% of matrimonial home proceeds = $125,116.91
Credits on account of monies already advance from joint matrimonial home proceeds: $42,500.
Amounts owing: $70,000 on account of Mr. Meydaner’s share of the joint line of credit.
Net Credit = $125,116.91 – ($70,000 - $42,500) = $97,616.91
16Having regard for the outstanding sum of $133,373 in matrimonial proceeds currently held in trust, if there were no debts to reconcile, each party would receive their share and bring this matter to a conclusion. However, that is not possible given Mr. Meydaner’s very substantial equalization liability.
17Justice Barnes was prescient when he raised concerns in February 2013 about any payout to Mr. Meydaner in the absence of disclosure, or by implication a final determination on equalization and other debt obligations by Mr. Meydaner to Mrs. Meydaner. Those concerns were validated at trial. On the evidence before the court, Mr. Meydaner does not have any assets in Canada to satisfy his debt obligation to Mrs. Meydaner. I therefore find that it is fair and just that his share of the $113,737, being $56,686.50, be paid to Mrs. Meydaner forthwith, and that thereby his outstanding debt on the equalization payment be further reduced, from $538,572 to $481,885.50, ($538,572 - $56,686.50).
18This reconciliation does not take into account the calculation of any pre and post-judgment interest which I fix at 3% and which is to be calculated by the parties, their accountants, and / or their lawyers, without my further involvement.
19For Mrs. Meydaner, it is appropriate that she receive her share since in the preceding paragraphs, I applied the monies she owed to Mr. Meydaner against Mr. Meydaner’s equalization debt, thereby reducing his debt.
20Paragraphs 8,9, 218 and 236 – 238 of the Final Judgment are superseded by this endorsement.
21I am hopeful that with the foregoing analysis, the parties will now be able to finalize the terms of a Final Judgment. The only comment I will add is to remind the parties that dissatisfaction with the outcome cannot be a basis for holding up approval as to form and content of the formal judgment. This is to be distinguished from seeking a clarification or correction. I raise this in light of a very lengthy letter of dissatisfaction and protest written by Mr. Meydaner that Mr. Meydaner’s counsel sent to my attention. That attachment was improper and unprofessional and I have not taken it into account. The remedy for any disagreement with the outcome is to seek an appeal. It certainly does not allow for the holding up of an approval as to form and content, or any other obstruction.
b) Release of Trust Funds
22Given my order on June 23, 2020 that the funds held by the real estate lawyer forthwith, there should not have been any resistance by Mr. Meydaner or his counsel to the issuing of a direction. Their refusal to do so is very disconcerting and amounts to an express defiance of a court order. More to the point, consistent with everything that has occurred in the progress of this Application, it reflected one more attempt by Mr. Meydaner to frustrate Mrs. Meydaner’s efforts to receive funds that duly owed to her.
23In light of such behaviour, any requirement for a direction is dispensed with and instead, this endorsement is to represent sufficient direction to the real estate lawyer for the release of the funds held in trust to Mrs. Meydaner. I am expressly allowing the Endorsement to serve the purpose of a direction, as opposed to an issued Final Order, because I cannot discount the possibility that attempts may be made to hold-up the payout further, pending the settlement of the final order.
24With respect to the indication that the real estate lawyer is seeking an administration fee, thereby reducing the net proceeds further to $113,147.74, those fees are to be deducted and the ultimate payout figure is to be determined as of the date of this endorsement.
c) Costs
25As the successful party, Mrs. Meydaner is entitled to her costs of the trial. It is most unfortunate that the parties could not settle their differences and arrive at an appropriate accounting. Having considered the submissions of the parties I conclude that it is appropriate to fix costs at $52,000, inclusive of all disbursements and applicable taxes. I have reached this conclusion for the following reasons.
26My decision is informed by the principles of found in Rules 24 and 18 of the Family Law Rules. In Mattina v. Mattina, 2018 ONCA 867, the Ontario Court of Appeal said:
[9] Section 131(1) of the Courts of Justice Act, provides that cost orders are in the discretion of the court. Rule 24 of the Family Law Rules sets out a framework for awarding costs for family law cases in the Family Court of the Superior Court of Justice, in the Superior Court of Justice and in the Ontario Court of Justice. Although the Family Law Rules do not expressly govern costs awards in the Court of Appeal, they have been used to guide this court’s analysis on costs in family law disputes.
[10] This court has held that modern family cost rules are designed to foster three fundamental purposes: (1) to partially indemnify successful litigants; (2) to encourage settlement, and; (3) to discourage and sanction inappropriate behaviour by litigants. Rule 2(2) adds a fourth fundamental purpose: to ensure that cases are dealt with justly, and Rule 24(12), which sets out factors relevant to setting the amount of costs, specifically emphasizes “reasonableness and proportionality” in any costs award.
[12] Rule 24(1) creates a presumption of costs in favour of the successful party of a motion, case, or appeal and the presumption that a successful party is entitled to costs applies equally to custody and access cases.
[13] Consideration of success is the starting point in determining costs. This presumption does not, however, require that the successful party always be entitled to costs. An award of costs is subject to: the factors listed in r. 24(12), r. 24(4) pertaining to unreasonable conduct of a successful party, r. 24(8) pertaining to bad faith, r. 18(14) pertaining to offers to settle, and the reasonableness of the costs sought by the successful party.
[14] Rule 24(12) sets out a list of factors the court shall consider in determining an appropriate amount of costs:
a. the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:
i. each party’s behaviour,
ii. the time spent by each party,
iii. any written offers to settle, including offers that do not meet the requirements of rule 18,
iv. any legal fees, including the number of lawyers and their rates,
v. any expert witness fees, including the number of experts and their rates,
vi. any other expenses properly paid or payable; and
b. any other relevant matter.
27Costs awards, at the end of the day, should reflect “what the court views as a fair and reasonable amount that should be paid by the unsuccessful parties”.(See: Boucher v. Public Accountants Council for the Province of Ontario, 2004 CanLII 14579 (C.A.), 71 O.R. (3d) 291, at para. 24.)
28In this instance, Mrs. Meydaner faced pronounced, deliberate and persistent challenges as a result of Mr. Meydaner’s refusal to produce any meaningful disclosure. He was determined to oppose her at whatever the cost, and even at this late stage, he continues to obstruct the conclusion of the matter with the refusal to issue a direction for the payout of the net proceeds, as directed in the final judgment.
29Having regard for Mr. Meydaner’s years of resistance to any meaningful disclosure, his multiple attempts to postpone the trial, and then the six-day trial, Mrs. Meydaner’s costs claim of approximately $52,000 is very modest. I expressly reject Mr. Meydaner’s submission that the costs claimed are excessive. Insofar as Mr. Meydaner’s lawyer suggested that his total costs did not exceed $26,000, I note that the submission does not take into account the costs that Mr. Meydaner would have incurred with the three preceding counsel who represented him.
30Also relevant to my consideration are Mrs. Meydaner’s offers to settle, which were conciliatory and excessively reasonable. The reality is that Mr. Meydaner would have been in a far better position than the final judgment had he accepted Mrs. Meydaner’s offers.
31Connected to the above findings is my recognition that although the issues in dispute were not complex, Mr. Meydaner’s efforts to frustrate the court proceedings resulted in a trial of six days, when it should not have exceeded three days.
32Finally, although I have some concerns that Mr. Levine’s Bill of Costs was outlined in very broad and general terms and was lacking in detail, I am reminded that the objective of a costs analysis is not to engage in a line-by-line accounting but to arrive at a costs award that is fair and reasonable for the unsuccessful party to pay. In this instance, $52,000 for a six day trial is more than fair and reasonable.
CONCLUSION
33In the result, costs in the sum of $52,000 are awarded in favour of Mrs. Meydaner. This liability is added to Mr. Meydaner’s net liability as outlined above and fixed at $481,885.50.
Tzimas J.
Released: September 16, 2020
COURT FILE NO.: 13-77178
DATE: 2020916
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Mrs. Hulya Meydaner, Applicant
and -
Mr. Behran Meydaner, Respondent
ENDORSEMENT
Tzimas J.
Released: September 16, 2020